OIG Says USPS Relocation Rules Were Not Violated In Purchase Of Employee’s Million Dollar Home
The OIG responds to a request by Senator Charles Grassley, Ranking Member of Committee on Finance (PDF) to evaluate USPS’ relocation benefits program.
Based on review of the documentation associated with this relocation action, as well as controlling regulatory authority, the Office of Investigations did not substantiate the allegation that relocation rules were violated. U.S. Postal Service Handbook F-15 Part 3, Relocation, issued March 2002 and in effect at the time of the relocation in question, addresses relocation benefits for non-bargaining employees. This policy provided no ,limit on the purchase price the Postal Service could be obligated to pay.
While Postal Service relocation benefits are generally comparable to other federal and private sector companies, the benefits it provides to relocating employees are very costly to the Postal Service. In calendar year 2008, the Postal Service spent $73 million for relocations that occurred during this time period were exorbitant. IN one instance, the Postal Service paid over $1.9 million to relocate a vehicle maintenance program analyst interstate. The majority of this cost came from a $1.7 million loss on the sale of this employee’s home. IN another instance, as cited by the national media and in your letter, the Postal Service paid $1.2 million to purchase and employee’s home though its real estate management firm. The home is currently under contract for $950,000, which will result in a Postal Service loss of $250,000 on the home sale.
USPS OIG Audit: High-Risk Contract Postal Units
From The USPS Office of Inspector General (OIG)
This report presents the results of our review of high-risk contract postal units (CPU) (Project Number 08BD009FF006). The U.S. Postal Service Office of Inspector General
(OIG) performed this self-initiated review to test selected transactions, address financial risk, and provide feedback to management to improve financial operations nationwide.
Host Post Offices, which are the post offices responsible for overseeing CPUs, did not provide sufficient oversight of the CPUs we reviewed, including collecting debts and
putting information into the financial system. Specifically:
• Host Post Office personnel did not always enter CPU financial information into the financial system in a timely manner. Our audit disclosed that employes at seven CPUs entered financial information from 6 to 13 days late.1 In conducting further analysis, we determined that, as of September 30, 2008, Host Post Offices took 5 days or longer to enter financial information at 114 of 2,901 CPU sites nationwide.
• Host Post Offices did not collect $76,643 in outstanding stamp and cash shortages from eight CPUs we reviewed. As of September 30, 2008, there was $162,993 in outstanding cash and stamp shortages for all CPUs nationwide.
• Host Post Offices improperly allowed CPUs to issue $14,198 in unauthorized and unsupported disbursements. This amount included $2,434in Express Mail refunds3 and other financial expenses and $11,764 for disbursements without supporting documents.
• Personnel at Host Post Offices responsible for two CPUs were unresponsive to our requests for documentation for disbursements totaling $11,042. We consider
these disbursements unsupported questioned costs.
During discussions with personnel at Host Post Offices, employees attributed these issues to employee turnover, inadequate training, and other higher priority duties. As a
result, the Postal Service has not collected $76,643 in funds owed by CPUs for stamp and cash shortages, and $25,240 in unauthorized and unsupported expenses.
We judgmentally selected the CPUs we reviewed based on risk factors using the OIG Financial Risk Model and, as such, we are concerned that the issues identified at these
CPUs could be occurring at others throughout the country. Specifically, we noted that, as of December 31, 2008, there were over $200,000 in uncollected stamp credit
shortages at CPUs nationwide. In addition, 14 units closed between August 2003 and May 2008 never cleared over $136,000 in stamp stock accountability. Consequently,
we believe the Postal Service can improve its oversight of CPUs in order to mitigate these expenses and reduce potential impropriety
BACKGROUND
CPUs are stations, branches, and community post offices operated under contract by individuals who are not Postal Service employees. Contracts to operate CPUs provide
that the contractor will transact specified postal business. During our quarterly analyses of the Financial Risk Model, we identified unusual expenses and other high-risk financial activity occurring at CPUs throughout the country. The transactions indicate potential financial mismanagement and may involve funds owed to the Postal Service. We designed this limited scope review to evaluate these risk factors at selected CPUs.
Too “Injured” to Sell Stamps, but Drywall and Hardware? No Problem!
From the USPS Office of Inspector General
Fraudulent workers’ compensation claims make up a small percentage of the total claims submitted by Postal Service employees. But they can cost the Postal Service thousands of dollars in long-term costs. So, when a tip on a suspect claim is reported to the OIG, our Special Agents investigate.
This was the case when a postal supervisor observed one of his employees, a Sales and Service Associate, working as a cashier at a home improvement store. Second jobs are not uncommon, especially in these economic times. But this employee was unable to work her postal job due to a claimed on-the-job injury to her right knee in March 2008. So, while gathering a home improvement store paycheck starting in April 2008, she was also receiving workers’ compensation payments – – 75% of her postal salary – tax-free!
OIG Special Agents found that the postal employee deceived her treating physician about her work capabilities and told the doctor the Postal Service had no “limited duty” work available. When the true information was provide to the physician, he immediately returned the employee to work full duty without medical restrictions. The Department of Labor terminated her benefits and the Postal Service avoided the potential cost of $1,103,149 in future OWCP compensation payments. The postal employee’s story doesn’t end there. She was fired from her job. A federal Grand Jury indicted her and a jury convicted her of making false statements and mail fraud. She is facing up to 25 years in prison at sentencing. She has got to be asking herself, “Was it worth it?”
If you suspect workers’ compensation fraud by a Postal Service employee, contact us at 1-888-USPS-OIG.
USPS Reports Financial Loss For April 2009
The US Postal Service filed its April 2009 (unaudited) preliminary financial report yesterday with the Postal Regulatory Commission. USPS reported a net income/ loss of $385 million. The total year-to-date loss is approximately $2.3 billion. unaudited (Jan, 658m) (Feb, 751m) (Mar, 491) (all unaudited totals) . Mail volume was down across all classes with an overall total decrease of 14.8%. The Postal Service continues to reduce its workhours with Mail Processing and Customer Services/Retail showing the highest reduction of 15.1% and 13.1% respectively. See charts below:
USPS Continues to Reduce Workhours
Postcom: Is it Time For A USPS Death Watch Blog??
“Newspaper Death Watch has reported that “publishers are finally beginning a sunsetting strategy for their print editions. By driving up circulation prices, they are effectively winnowing out their low-value customers. Price increases will probably come fast and furious in the future. Each will cause circulation to fall until a new floor is reached. Expect circulation declines to quicken as more newspapers adopt the strategy. [Postcom] EdNote: Sounds some days like a strategy the USPS has adopted. Increase your prices. Pass along your costs in the form of oppressive worksharing requirements, and squeeze the lifeblood out of your most important First-Class Mail customers by having the Postal Inspection Service serve them with criminal offense notices. It’s a great way to show the value of doing business with you. Soooooo, who’s gonna host a ‘Postal Service Death Watch’ blog?”
Develop Next Generation Postal LLV Using Stimulus Money for Electric Vehicles?
First, here is a summary of paper presented by Michael Ravnitzky, Postal Regulatory Commission (PRC) delivered at the Advanced Workshop in Regulation and Competition, Center for Research in Regulated Industries – Rutgers University 28th Annual Eastern Conference Skytop, Pennsylvania May 13–15, 2009. The full paper can be found on the PRC’s website by clicking here
Electric Drive Vehicles For Mail Delivery: Identifying Key Issues
Abstract
Electrification of the postal fleet should be an integral part of the nation’s energy goals. Most daily mail delivery routes are short, repetitive and well-defined, and include many stops, making the postal delivery fleet a prime application for electric drive vehicles. The electrification of the postal fleet could significantly reduce gasoline and maintenance expenses while reducing the fleet’s carbon footprint.
Furthermore, the postal operator can earn substantial revenue in the wholesale electric markets by aggregating and offering on the wholesale electric market access to ancillary electric power from the vehicle batteries. Off-peak charging, grid operator control of off-peak charging, and particularly the availability of aggregated storage capacity would enhance the ability of the nation’s electrical grid to incorporate renewable sources of electricity, sources such as wind and solar power which tend to be variable in output.
Also excerpts from a powerpoint presentation by prepared Erik Toomre of Mobility Future LLC. The full presentation can be found by clicking here
Assertions
The USPS has demonstrated leadership with the size and mix of its alternative fuel fleet.
It is in the national interest to make a highly efficient all-electric postal vehicle.
Use stimulus money to create, test and validate “ideal” electric LLV to set specifications for lowest lifecycle cost replacement LLV in 2015.
Timing is Perfect to use Stimulus $ for USPS Development & Trial prior to Mass Replacement
Source: “US Postal Service Fleet Planning and Management” – Presentation to GovEnergy 2007
Planned LLV replacement beginning in 2015 allows sufficient time to develop and validate key technologies for cost-effective next-generation electric LLV’s
Snapshot of Electric LLV Possibilities
1.“Fuel” operating cost — close to parity in 2008 and then lower cost per mile as batteries continue to improve. [Based on battery depreciation cost plus electricity vs. gas cost per mile]
2.100-mile per gallon (equivalent) economy or better in urban driving
3. Battery module interchangeability and an architecture that does not rely on a sole-source battery supplier and allows additional modules to be added when greater range is required
4. No compromise on LLV mission requirements
5. ~ 76% reduction in CO2 emissions:
Current LLV Fleet generates over 600K metric tons of CO2 per year. [Based on 142K LLV’s * 5K mi/yr * (1/10.4 mpg) * 19.4 lbs CO2 per gallon gas burned * (1 metric ton/2204.6 lbs)]
All electric LLV fleet would generate ~144K metric tons of CO2 per year. [Based on 142K eLLV’s * 5K mi/yr * (337 Wh/mi) * 1.33 lbs CO2 per kWh [2007 U.S. average in electric utility sector] * (1 metric ton/2204.6 lbs)].
Bill To Rehire Federal Retirees Faces Uphill Battle
From Federal Times
A bill that would allow agencies to rehire retired employees won approval of a Senate committee last week. But, despite measures designed to appease unions, it still faces opposition from labor groups.
The bill would create a five-year pilot program allowing agencies to rehire retirees and pay them their full salary and their full annuity. Currently, personnel rules don’t allow retirees to collect their full salaries and annuities without special waivers from the Office of Personnel Management. The Senate bill would allow agencies to rehire retirees without having to get such waivers.
Although the bill, S 629, enjoys support from lawmakers of both parties, the Obama administration and several federal associations, its fate is uncertain because of opposition from federal unions. Unions fear that rehiring retirees — even on a temporary basis — will undermine the hiring of new employees and thwart promotions of current federal employees. read full story from Federal Times
USPS and APWU agreed to an MOU on the hiring of retirees during contract negotiations —but the MOU was nixed by OPM
The Memorandum of Understanding between USPS and APWU states:
Re: Retail Associate
The parties agree to convene a national task force to establish rules and procedures for the utilization of supplemental retail sales and associates. The Task Force will include consideration of a process by which the Union may provide lists of prospective workers to perform retail duties in locations identified by the parties. Such workers will not be a part of a supplemental workforce under Article 7. The meetings will begin no later than February 1, 2007 and will be concluded by May 1, 2007.
It is interesting to note that during negotiations for the contract extension in 2005, USPS and APWU explored the creation of Retail Sales Assistants “who would work in grocery stores, malls, and other venues that are easily accessible to the public. These positions would be reserved for retired postal employees, who would continue to draw their retirement annuities.”
“But union and management representatives were notified by the Office of Personnel Management (OPM) that such an arrangement could not be approved.”
OPM issued regulations to amend the criteria under which they may grant dual compensation (salary off-set) waivers on a case-by-case basis, or delegate waiver authority to agencies. The amended regulations would allow retired workers to return to the federal government without a paycut. OPM Proposes Rule Change to Re-Employ Retirees Without Pay Cut
USPS To Offer Greeting Cards In Post Offices
The United States Postal Service (USPS) will partner with a supplier who has NATIONAL DISTRIBUTION AND WAREHOUSING CAPABILITIES to introduce a range of greeting card formats to be sold at postal retail locations. This initiative will:
• Determine retail sales opportunity of offering greeting cards in Post Offices
• Evaluate SKU level sales to optimize product mix for launch
• Evaluate merchandising solutions
o Flexibility of solutions for varied office configurations
o Aesthetically pleasing in USPS retail environment
o Meets USPS requirements (i.e., Safety & Heath Equipment Guidelines)
• Increase single-piece First Class Mail volume
• Provide added convenience to USPS customers
• Provide added support to USPS retail employees
The Postal Service will execute the Greeting Card test pilot in three (3) phases. Phase I will issue a RFP for the Greeting Card test, along with a Statement of Objective (SOO). SOO is defined as “a document that describes the basic, high-level objectives of the purchase, to allow potential suppliers the flexibility to develop cost-effective solutions and the opportunity to propose innovative alternatives to meet Postal Service objectives. “ Phase II is the actual Greeting Card Test Phase for the successful candidate. The Test will be performed in 1,500 Post Offices. The test phase is expected to run at least one (1) year, and is planned to start October 1, 2009. Phase III exercises the Option Period, which allows the supplier to update their proposals and write the final Statement of Work. USPS intends full implementation to approximately 15,000 Post Offices.
source: Fed Biz Opp
USPS Bay-Valley District To Implement Phase 2 of The National Reassessment Process
From Fredric Jacobs, President, APWU Local Oakland #78
National Reassessment Process – Phase 2
Attention APWU Members:
Today (May 20, 2009), I was advised by Management that the Bay-Valley District received Phase 1, National Reassessment Process (NRP) validation on May 8, 2009.
A Phase 2 briefing meeting has been scheduled with the Unions and Management on Wednesday, May 27, 2009.
Members are encouraged to attend the upcoming Injured Employees Seminar on June 6, 2009.
If you have any questions, please contact Executive Vice President Robert Jeffrey or Business Agent James Perry at the Union Office, 510-635-8497.
What is Phase 2 of the National Reassessment Process?
PostalReporter- According to the National APWU:
Once a District completes all required Phase 1 actions, USPS Headquarters will be notified that the District is ready to begin Phase 2. No more than three Districts per Area should be in Phase 2 at a time.
Phase 2 will include: Evaluating the “necessity” of specific job duties; interviewing partially recovered employees; and then either renewing their existing job offer, providing new job offers, or referring the employees to OWCP. [NRP Phase 2 Overview - PDF 5MB)]
Providing limited-duty and rehab jobs will take priority over establishing light-duty assignments. This remains a possible area of contractual dispute. If medical documentation establishes that a limited-duty employee has reached maximum medical improvement (MMI), that employee will enter the Postal Service rehab-job process. The craft that is indicated on the employee’s Form 50 will be the craft that will first be reviewed for suitable employment.
The USPS should be made aware of all duties that an affected employee can perform. Any non-work-related medical restrictions should also be evaluated. If no job offer is made, the employee should identify for the record duties that they can perform. Employees will have 14 days to accept or reject a job offer. If employees want their physicians to review the job offer, reasonable requests for extensions should be granted.
The local union and employee will receive approximately one week’s notice of an interview date. At the “interactive” interview, employees who are not given job offers will be provided with Forms CA 2a and CA7 (“Recurrence of Disability” and “Claim for Compensation”) and then sent home.
Lawmakers Urge USPS To Keep New Castle (PA) Mail Processing Facility Open
Press Release
(WASHINGTON, D.C.) — U.S. Congressman Jason Altmire (PA-04) and U.S. Senators Arlen Specter (D-PA) and Bob Casey (D-PA) announced today that they have sent a letter to the U.S. Postmaster General John E. Potter urging him to keep the New Castle Mail Processing Facility open. On April 10, 2009, the United States Postal Service (USPS) announced that it would conduct a study to examine whether it should consolidate the New Castle Mail Processing Facility with its Pittsburgh facility.
Although Congress does not have oversight over USPS’s operational decisions, Congressman Altmire and Senators Specter and Casey are working with the New Castle community to show USPS how important it is to keep the New Castle facility open. In their letter, Altmire, Specter, and Casey stated that they believe both the New Castle and the Pittsburgh mail processing facilities are needed to ensure efficient mail delivery throughout our region.
“The New Castle Mail Processing Facility is an important asset to our community and it should be kept open,” Congressman Altmire said. “This facility employs hundreds of people and provides a vital service for local residents and businesses. I hope that after considering the negative effect that the closure of this facility would have on our local economy and on the efficiency of mail delivery throughout our region, the United States Postal Service will make the right decision and agree to keep it open.”
“It is vital that the Postal Service weigh heavily the needs and welfare of the New Castle community during their review,” Senator Specter said. “At a time when our nation faces record unemployment rates, it is vital to consider the Post Office’s importance to the community, the local economy, and efficient mail services.”
“The New Castle Mail Processing Facility provides a great service and employment to members of the New Castle community,” said Senator Casey. “I urge Postmaster General Potter to consider this as the Postal Service conducts its review of the facility. Closing the facility will negatively affect the community and its workers and in these tough economic times, we must do whatever we can to prevent it.”
Related links:
APWU: Area Mail Processing study announced [PDF]
visit website savenewcastlemail.com